09-12-2011 06:25 AM - edited 09-12-2011 02:42 PM
At the close:
The Dec. corn futures settled 9 cents higher at $7.45 1/2. The Nov. soybean contract closed 30 3/4 cents lower at $13.96. The Dec. wheat futures ended 2 1/2 cents lower at $7.27 1/4. The Dec. soymeal futures settled $9.30 per short ton lower at $365.80. The Dec. soyoil futures settled $0.96 lower at $57.75.
In the outside markets, the NYMEX crude oil is $0.99 per barrel higher, the dollar is higher and the Dow Jones Industrials are down 56 points.
The buyers returned for the corn market.
Corn turns higher. Soybeans are still heavily pressured by the USDA Sept. Report.
The Dec. corn futures are trading 1 1/2 cents lower at $7.35. The Nov. soybean contract is 30 cents lower at $13.97. The Dec. wheat futures are 9 cents lower at $7.21. The Dec. soymeal futures are trading $10.30 per short ton lower at $364.80. The Dec. soyoil futures are trading $0.90 lower at $57.81.
In the outside markets, the NYMEX crude oil is $1.15 per barrel higher, the dollar is higher and the Dow Jones Industrials are down 62 points.
Buyers have faded and the outside markets are killing any momentum for the farm markets Monday. All of this on top of the fact the USDA Reports were bearish, one trader says.
Corn is just slightly lower, as soybeans tumble to 22 cents lower and wheat down 9. By the way, USDA announces Monday that 114,300 mt of U.S. corn was sold to an 'unknown' buyer.
At the open:
The Dec. corn futures opened 1 cent lower at $7.35 1/2. The Nov. soybean contract opened 14 1/4 cents lower at $14.12 1/4. The Dec. wheat futures opened 11 3/4 cents lower at $7.18. The Dec. soymeal futures opened $6.30 per short ton lower at $368.80. The Dec. soyoil futures opened $0.30 lower at $58.41.
In the outside markets, the NYMEX crude oil is $0.43 per barrel higher, the dollar is higher and the Dow Jones Industrials are down 63 points.
As we get closer to the opening bell, we are hearing that corn's Early Call is edging towards unchanged to possibly slightly higher.
One trader says, "I was +5 in corn and -20 on beans… I think beans could be -20 -40 lower with corn getting knocked down to unchanged…the World feed grain and wheat numbers were higher, suggesting more feed wheat. World wheat ending stocks up 6 mmt to that can be a buffer on corn. USDA also has Brazil corn 5mmt higher, but only took Brazil corn exports up 500,000. So, they could raise Brazil exports further. The problem with getting corn up today is no one wants to add to long position given default risk in EU."
One trader says, "Corn is +5 can beans down -20….corn bulls got all they would ask for… and on the production side will have to worry about further reductions in yield and lower acres on the Oct report…. Ethanol break even is around 750 basis the Dec … meanwhile beans yields were better than expected and we think USDA is too high on bean exports… SA is competitive well into our marketing year with the record carryin crop down there…the only thing that I can see mitigating sentiment in corn is perhaps some fear of the Sept stocks report…early harvest, wheat feeding, better ethanol yield can all add some stocks back but we will worry about that at end of the month."
--Another trader says, "I view the report as negative. Soybeans were dead on expectations, nothing special there although yield was up. Corn production a little bullish but demand was cut for an increase in ending stocks. Overall I view that as negative so I am saying lower. I am hearing higher calls but if so I would sell and see how it goes. Wheat demand up a bit at the expense of corn, maybe this is the higher market today. However, world data considered negative. So maybe not at the end. Overall I would say a disappointing report for the bulls.
---One trader says, "The corn yield came in as expected. Although the USDA lowered the yield by 5 bushels since August, it's not a shocker, traders say. The world markets are tanking and the dollar is stronger. The soybean yield number was bearish with a higher number than expected, carryout is higher, world carryover for corn is higher. It will be hard to rally, in the face of this morning's Report."
--Yet another floor trader says, "Just looked at the numbers. To me the corn yield/carrying came in about as expected. Think we have been trading a 148-149 yield for a couple of weeks now. The bean yield is the shocker. Think beans will be calledsharply lower of this and that should drag corn. "
---Yet one analyst says, "By early glance the corn yield is bullish, but the usage cut was DRAMATIC. Production came down 5 bushels/acre = 420 million bushels, yet carryout only declined by 42 million bushels.
The trade is going to have a hard time believing this large of a usage cut following last month’s sharp cuts. This is basically USDA saying, carryout is not going below 700 million bushels by much as this is about pipeline, they are going to let the trade figure everything else out.
Corn used for ethanol down 100 million bushels
Exports down 100 million bushels
Soybeans at first glance looked a little bearish. Yield increased to 41.8 up 0.4 bushels/acre and carryout was about steady at 165 million bushels
I haven’t had a chance to look at state by state yields yet, but will do next and follow up if I see anything out of the ordinary.
The report will be bearish to soy/wheat and a little positive to the corn.
In my view, the trade will be suspect of these aggressive usage cuts."
The Early Calls for commodities: Corn 5-10 cents lower, soybeans 10-20 cents lower, and wheat to follow.
Corn= 148.1 bushels per acre vs. the trade's average analyst estimate of 148.8 bushels per acre. The corn production is pegged at 12.497 billion bushels vs. the average estimate of 12.505 billion bushels and the government's last estimate of 12.914 billion.
Soybeans= 41.8 bushels per acre vs. the average trade estimate of 41.0 bushels per acre and the USDA's August estimate of 41.4. The U.S. soybean production is estimated at (3.085 billion bushels vs. the average trade estimate of 3.025 billion bushels and the USDA's previous estimate of 3.056 billion.
The Reports feels bullish. What do you think?
I feel nervousness out there, regarding what this number will be this morning. You are not nervous are you?
Early calls: Subject to the USDA September Crop Production and Supply/Demand Reports to be released this morning at 7:30am CDT.
Overnight grain, soybean markets=Trading lower.
Crude Oil=$1.44 lower.
Wall Street=Seen trading lower as the fallout continues from the resignation of a leader of the European Central Bank. Plus, International Monetary Fund sources may not be sufficient, if more global loans are needed.
World Markets=Lower as France's banks are now showing trouble signs. Yet more evidence the Euro's crisis is spreading.
More in a minute,
09-12-2011 07:02 AM
Seems to be some bullish sentiment out there for the corn market this morning.
--One analyst is out there saying corn could soon breach $8.00.
--The Funds upped their 'long' positions last week in the corn market by 1.2% to 331,350 contracts. And they increased their soybean 'longs' by 2.5% to 174,091.
09-12-2011 07:45 AM
pretty much standard stuff.............they cut corn production, but keep hacking away at demand, that only works so long before demand doesn't actually quit eating.......
they raised soya production, not surprising given the USDA thinks things got better...........again, many have paid lip service to my outlook all winter, spring, summer..........we will let the combines tell the story.........soya yield is not there...........
wheat was alittle interesting, given we hear about all this wheat being used instead of corn, yet numbers are not saying this, IMO anyway............so what gives............demand cuts across the board can only go so far before reality hits..........
last years Sept report was similar before the bombs were dropped in Oct and beyond.............you have to wonder if it can get worse next month????????? funny we went from needing 92 perfect acres to whatever............and needing 78 perfect acres to whatever........
this drought doesn't break in the SW its only going to get more interesting.............I will admit I am surprised we have hung on this long, but next spring/summer could tell us just what is left.........
09-12-2011 07:58 AM
This report is just another report from the famed USDA, We all know there isn't enough corn out there this year, and how did the US raise wheat production? I was reading on the custom harvestor report that up around North Dakota one cutter didn't go up there cause the farmers only got 30% of the acreage planted.
This is the way that the USDA trys to control price, but giving us these numbers to play the market with.
I was told the other day that the corn price is still "Cheap" according to other corn prices around the world.
09-12-2011 08:05 AM
Oh come on MT you wanted lower demand and then you say demand will not quit eating?
Demand has been creamed just cause E hasn't stopped doesn't mean the rest of us are still knocking at the door!
09-12-2011 08:08 AM
They still haven't recognized lower acreage numbers in both corn and beans. On the bright side, they didn't find another 300 million bushels of corn.......they just lowered demand 400 million bushels. I believe the trade will soon disregard these numbers and bearishly trade the grains due to the other stuff going on in the financial world........that is until the realization of the potential frost scare later this week.....then, watch out.
09-12-2011 08:19 AM - edited 09-12-2011 08:20 AM
said I wanted lower demand............I said they would lower it to make up for supply shortfalls..........
the only time I have mentioned demand rationing............was in the context of exports...........if we have to ration our total demand, it would be nice to ration it via exports thus allowing or domestic uses to remain............however given our dollar the last year, that is probably the last place it gets rationed..........
now heres something to think about............about a year ago I made the comment on the other site that grains in the future would be affected much less by dollar movements, if at all...............and that we could likely see, and need to see the dollar rally along with grains to drive home the point that grains are their own special class of commodities because of their need for our basic existance...........you don't need oil or gold or silver or copper or whatever to live.........but you do need some sort of good.........
grains will become their own currency going forward............and by default will have to inflate in price to match the inflation of everything else over the last 100 years, while grains practically stood still...............
09-12-2011 08:23 AM
Sounds like that potential for frost in the northern Corn Belt has a lot of attention among traders, too. Anybody up north bracing for a cold shot later this week?
09-12-2011 08:41 AM
The report reminds me of getting loans back in late 60's and early 70's. Some years I had to predict higher yields and trim my expenses to make it cash flow, even tho it wouldn't, but it worked in the long run.
This doesn't surprise me as I knew they would trim yield and useage, but I thought they would trim yield more.
I have been reading where the south and southwest drought could prolong for ten or twelve months. I hope not.
What happens if that is the case and it moves up a couple of states? I for one will not sell all my corn untill I see what happens next spring. Enjoy the people on this site.
09-12-2011 08:47 AM
One thing is for sure.......demand will be stimulated higher by lower prices.